The Rule That Was Supposed to Make Canceling Subscriptions Easy Is Stuck

Amazon agreed to pay $2.5 billion in September 2025 to settle federal claims that it made Prime memberships deliberately hard to cancel. The rule that was supposed to make every subscription in the country that easy to quit? It still doesn't exist.

Eighteen months after a federal appeals court threw out the Federal Trade Commission's "click to cancel" rule on a procedural technicality, the agency is still rebuilding it from scratch — and the rebuild hasn't reached a draft rule yet. Anyone hoping canceling a gym membership or a streaming plan would get easier under one federal standard is, for now, still relying on a patchwork of state laws and after-the-fact lawsuits instead.

The rule, formally an amendment to the FTC's decades-old Negative Option Rule, would have required three things of any company selling a subscription or automatically renewing service: clear disclosure of the price and billing terms before taking payment, a separate, affirmative consent to the recurring charge, and a cancellation method "at least as easy to use as the method the consumer used" to sign up. Companies that violated it faced civil penalties of up to $53,088 per violation.

The FTC finalized that rule in October 2024 after a 3-2 commission vote and more than 16,000 public comments. It never took effect. On July 8, 2025, the U.S. Court of Appeals for the Eighth Circuit vacated the rule in full, ruling that the FTC had skipped a legally required step: a preliminary analysis of the rule's costs and benefits, mandatory for any rule expected to carry an economic impact above $100 million. The commission's own presiding officer had found the rule would clear that bar; the agency's final version never got the analysis the law required at the proposal stage.

The court didn't rule on whether the rule itself was good policy. It ruled that regulated businesses never got a fair chance to challenge it, warning that letting the FTC's shortcut stand "could open the door to future manipulation of the rulemaking process" — an agency lowballing a rule's cost estimate specifically to dodge the public comment that estimate would otherwise trigger.

The commission, now under Republican control, has shown no interest in appealing that decision or simply reissuing the same rule. Instead, it restarted the process from zero. On March 13, 2026, the FTC published an Advance Notice of Proposed Rulemaking — in effect, a public questionnaire asking whether a new rule is needed at all, and if so, what it should require. The comment period closed April 13, 2026. As of this month, the agency has not published an actual proposed rule — the FTC's own rulemaking page still lists the March ANPRM as the latest step — which puts the earliest plausible date for a new federal requirement at some point in 2027.

None of that has slowed FTC enforcement against individual companies, because two older statutes already cover most of the same ground. The Restore Online Shoppers' Confidence Act, known as ROSCA and in force since 2010, already requires "a simple mechanism" to stop recurring online charges. Section 5 of the FTC Act already bans deceptive cancellation flows outright. The agency has leaned on both hard since the click-to-cancel rule was struck down:

The Amazon case alone was the largest civil penalty ever imposed for an FTC rule violation, and only the third time the agency has ever secured a civil penalty under ROSCA since that law passed in 2010. It covers an estimated 35 million U.S. customers charged for Prime between June 2019 and June 2025; eligible consumers can get up to $51 back.

Uber is the newest target. The FTC's lawsuit against the company, amended in December 2025 to add 21 states and the District of Columbia as co-plaintiffs, alleges that canceling an Uber One membership required navigating seven different screens and twelve separate actions — and that the subscription generated nearly $1 billion for the company partly by enrolling riders without clear consent.

The rules that already apply, state by state

While Washington stalls, roughly 30 states have passed their own automatic-renewal laws, and several go further than the federal rule ever would have. California's law, amended in 2025, requires affirmative consent kept on file for at least three years and a "click to quit" cancellation option for anyone who signed up online. New York's requires cancellation through every method a customer used to sign up, plus advance notice before any price increase. Colorado extended its auto-renewal law to business-to-business subscriptions in February 2026, closing off the old defense that consumer-protection rules don't reach software sold to companies.

Two states specifically police the "please don't go" offer a company shows on the way out the door. Minnesota bars unsolicited retention offers during cancellation outright; a company can only show one if the customer asks to see it first. Connecticut, starting July 2026, will require companies to tell a subscriber they can cancel at any time before mentioning any discount or downside to leaving.

For a subscriber trying to cancel something right now, the practical upshot is this: there is no new federal button that makes it easy, and there may not be one for another year or more. But "it's technically legal to make this hard" stopped being true for most online subscriptions back in 2010, under ROSCA, whether or not the newer rule ever existed. A company that requires a phone call to cancel something sold online, buries the cancel option behind several menus, or keeps billing after a customer confirms a cancellation is already exposed to federal and state penalties — Amazon's $2.5 billion settlement is the clearest proof the FTC doesn't need the vacated rule to bring that case.

The FTC's original announcement of the rule, before the Eighth Circuit vacated it — the starting point for everything that's followed since:

Post by @FTC

It's one more example of a theme Daybreak Wire keeps running into this year: a protection people assume is settled law turns out to be anything but. The same was true of why candy prices didn't fall when cocoa prices crashed — the rule or the market force consumers expect to be working in their favor usually isn't doing what they think it is.

A bipartisan bill introduced in the Senate would write similar cancellation protections directly into federal statute, skipping the FTC's rulemaking process altogether — a sign that even some lawmakers who welcomed the court's ruling think subscribers are owed more than a questionnaire. Congress has shown no urgency about moving it. Until it does, or the FTC finishes what it restarted in March, the rule that was supposed to make quitting easy remains, itself, something nobody can quite cancel.